PRAIRIE GROVE -- The city will be able to save more than $580,000 in interest costs over a 20-year period by refinancing three water and sewer bond issues.
Prairie Grove City Council approved an ordinance last week for a $4.7 million 2021 water and sewer revenue refunding bond issue.
Bob Crews with Crews & Associates explained that the action is similar to someone refinancing their home mortgage at a lower rate of interest.
The city will refund three issues from 2010, 2013 and 2015 and combine those into one bond issue, with a "true interest cost" of 2.0247%, Crews said, adding the city is not extending its debt service, just lowering the interest rate.
The outcome in selling the bonds turned out better than Crews had expected when he proposed refinancing the debt in November. At that time, he said he thought the city would pay an interest rate of 2.14% on the debt with an overall savings of $367,000.
"The market obviously helped," Crews said.
Ryan Bowman with Friday, Eldredge and Clark law firm in Little Rock said the transaction for the refunding issue would close on May 25.
"The loans will be paid off and the new 2021 bond issue will take over," Bowman said. "You are simply taking what you have and moving it over to a new bond issue at a lower interest rate."
First Community Bank will serve as the bond trustee. Debt payments will be due May 1 of each year, with the first payment of about $400,000 due May 1, 2022.
In other business, the city council spent considerable time talking about private parties at the aquatic center this summer, whether to change the width of streets and the city mask ordinance.
The council voted to allow private pool parties but to limit the parties to 50 guests because of covid-19 concerns and restrictions put in place by the Arkansas Department of Health for safety protocols.
Council member Rick Ault brought up the mask ordinance at the end of the meeting. Ault said he believes there is confusion in the community on whether or not the city has a mask mandate.
He said 95% of the people he talks to do not believe the city has a mask ordinance in place now.
The council adopted a mask ordinance on July 13, 2020. It stated that the city would require face coverings according to department of health guidelines in an effort to help curb the spread of covid-19.
"I think we should repeal the mandate and go on the record supporting the businesses that want a mask mandate," Ault said.
Mayor Sonny Hudson disagreed, noting he believes if the council repeals the ordinance, it would suggest to the community that the council doesn't care. Hudson said the Arkansas Municipal League also is encouraging cities to have a mask ordinance, since the governor has removed the statewide mask mandate.
City Attorney Steven Parker said his interpretation is that the city's mask ordinance was adopted in accordance with department of health guidelines. These guidelines now "strongly recommend" that people wear masks.
"The way I read our ordinance whatever the department of health says, that's what our ordinance says," Parker said.
Hudson said the city is leaving it up to businesses on whether they want to require masks, and the city will support those decisions.
"I'm having a hard time figuring out why there's a problem," Hudson said.
City Clerk Christine Kelly said City Hall has received calls from businesses asking if they are required to make people wear masks because of the city's mask ordinance.
Ault made a motion to rescind the mask ordinance but no one seconded his motion.
Hudson said he would talk to the municipal league to get some clarity and bring back a recommendation to the council.
The discussion about street widths resulted from a request by the developer of Hudson Heights subdivision. The developer has asked if it could prohibit parking on the streets in the subdivision so it would be able to install narrower streets.
Council members wondered how that would work when people have parties, gatherings or yard sales.
The council did not make any decisions on street widths, with fire Chief J.C. Dobbs saying there are problems with too many people parking on the streets in several subdivisions, making it hard for emergency vehicles to access the streets.
Hudson asked Parker if he would do some research on street widths in other cities.
The council also is discussing a curb and gutter ordinance that would allow developers, with written approval from the planning commission, to pay into a fund rather than install curb and gutter. No action was taken on this ordinance.